2016 Alegeus Healthcare Consumerism Index reveals modest increase in cost and value-conscious spending behaviors
Published on June 22nd, 2016
Consumers are increasingly responsible for the cost of their healthcare – as evidenced by rising deductibles, growing out-of-pocket costs and accelerating adoption of consumer directed health plans and accounts. However, it is evident that consumers may not fully be prepared to manage these new responsibilities.
The 2016 Alegeus Healthcare Consumerism Index is an annual report that measures the degree of engagement and ‘consumerism’ exhibited during healthcare spending and saving decisions and affirms that there is still much room for improvement for consumers to optimize their financial health.
Based on a survey of more than 1,000 U.S. healthcare consumers, the 2016 index evaluated two specific aspects of healthcare consumerism – 1) the degree of cost/value orientation exhibited during healthcare “purchases” and 2) the degree of savings focus/discipline to plan for healthcare cost responsibilities. For each category of consumerism – spending and saving – survey responses were tabulated into a single rating score on a 0-100 point scale. The bigger the number, the greater the degree of consumerism exhibited.
Healthcare spending = 54.4 (out of 100)
Consumers were asked to assess their attitudes and behavior for a wide set of spending decisions – including both healthcare and non-healthcare purchases. The same set of questions were asked for each type of purchase decision to allow easy comparison. This year’s spending index of 54.4 represents modest improvement over last year’s score of 48.3 and paints a very telling picture. While healthcare consumers have made some progress in the past 12 months, they are still much more engaged and thoughtful about buying a TV (scoring a 78.9) than they are about making decisions concerning their own healthcare.
Despite the fact that 76 percent of consumers now say they are very focused on getting the best value for their healthcare dollars, more than half of those consumers still don’t understand their cost responsibility for a given service until they receive the bill after the fact. We did see some improvement in pre-purchase behavior, with a 20 percent increase in consumers that report doing research and comparing alternatives before a major service or procedure.
Healthcare saving = 21.88 (out of 100)
This year, consumers were asked to consider their attitudes and behaviors regarding savings for various costs, such as retirement, their kid’s college education and an emergency fund. Disciplined saving for short- and long-term healthcare costs represents a paradigm shift for most consumers, and the research findings affirm that the majority of consumers are under-funding their healthcare savings. Consumers are twice as focused on saving for retirement as they are on saving for healthcare. Only 34 percent of consumers say they understand how much they will need to save to pay for healthcare costs this year. Even fewer understand their long term healthcare cost obligations. Only 23 percent of consumers say that they are saving aggressively for healthcare costs and less than a third say they are confident that they have maximized tax benefits for their healthcare savings.
Empowering Consumers to Take Greater Ownership of their Healthcare Finances
It’s clear that consumers will need significant education, tools and support as they assume more financial responsibility for healthcare costs. It is up to industry leaders to empower the modern healthcare consumer, and Alegeus is committed to providing the market with innovative capabilities and the necessary support to help consumers make informed decisions to optimize their healthcare spending and maximize their healthcare savings – and become more savvy healthcare consumers as a result.